Tharp v. CitiMortgage Inc.

Background

Kevin T. Tharp, representing himself, sued CitiMortgage, Inc. and Christopher Daniel Davies. The dispute arose from a mortgage Tharp took out with CitiMortgage in January 2008 on property in Lakeland, Minnesota. CitiMortgage foreclosed on the mortgage in 2012, and the foreclosure sale occurred on February 8, 2013. Under Minnesota law, Tharp’s six-month right to redeem the property expired on August 8, 2013.

Tharp filed the operative complaint on May 16, 2019. He alleged violations of the Real Estate Settlement Procedures Act, the Fair Debt Collection Practices Act, the Privacy Act, and the Fair Housing Act. He also asserted claims for breach of contract, fraud, forgery, intentional infliction of emotional distress, and interference with his Minnesota statutory right to redeem the property. CitiMortgage moved to dismiss for failure to state a claim or, alternatively, for a more definite statement. Tharp later offered an amended complaint, which the court treated as a request for permission to amend.

Statute-of-Limitations Rulings

The court held that the Real Estate Settlement Procedures Act claims were barred by the statute of limitations. That statute generally requires a claim to be filed within three years of the violation. The latest dated conduct supporting Tharp’s allegations was a March 21, 2013, letter, more than three years before he filed suit.

The court also dismissed the Privacy Act claims as untimely. Those claims generally had to be filed within two years, and the court concluded that any adverse credit reporting connected to the mortgage debt would have occurred no later than 2013. The Fair Debt Collection Practices Act claims were likewise untimely because they had to be filed within one year of the alleged violation, and Tharp did not plausibly allege collection calls after 2013.

The court treated Tharp’s reference to “indirect discrimination, age, race” as an intended Fair Housing Act claim. It held that this claim was barred by the Fair Housing Act’s two-year filing period because Tharp did not allege conduct by CitiMortgage later than March 2013.

The court held that Tharp’s breach-of-contract claim was barred by Minnesota’s six-year limitations period. Although it was unclear what contract Tharp claimed CitiMortgage breached, the court concluded that any possible breach would have occurred no later than the February 2013 foreclosure sale and discharge of the debt.

The court also held that the fraud claim was untimely. The criminal statutes Tharp cited did not create civil liability, so the court construed the allegations as a civil fraud claim under Minnesota law. Because Tharp’s own materials showed that he knew of the alleged fraud by no later than 2012, the six-year limitations period had expired before he filed suit. The court similarly held that the intentional-infliction-of-emotional-distress claim was barred by Minnesota’s two-year limitations period.

Redemption Claim

The court separately considered Tharp’s claim that CitiMortgage interfered with his statutory right to redeem the property. The court explained that Minnesota law provides a six-month redemption period after a foreclosure sale and requires payment of the foreclosure-sale amount plus interest.

The court determined that the longer, fifteen-year limitations period for challenges to a foreclosure sale applied because Tharp did not appear to be challenging the sale based on defective notice. But the claim still failed under the pleading standard, which requires enough factual matter to make relief plausible. Tharp alleged only that his redemption right had been “violated and severely interfered with.” He did not allege that he followed, or attempted to follow, the statutory postponement or redemption procedures, or that CitiMortgage prevented him from doing so. The court concluded that his March 21, 2013, letter and the other allegations did not support a reasonable inference of interference.

Other Party and Proposed Amendment

The court noted that Tharp named CitiMortgage’s former president and chief executive officer, Christopher Daniel Davies, as a co-defendant but made no specific allegations against him. Because Tharp asserted no personal claims against Davies, the court dismissed Davies from the lawsuit.

The court reviewed Tharp’s proposed amended complaint and exhibits and concluded that the proposed changes would not alter the outcome. It therefore denied Tharp’s request for leave to amend because amendment would be futile.

Disposition

Judge David S. Doty granted CitiMortgage’s motion to dismiss, denied CitiMortgage’s motion for a more definite statement as moot, and denied Tharp’s request to amend. The court dismissed the case with prejudice and ordered judgment entered accordingly.